3
3 INTRODUCTION 1.Background to inclusion of services in the UR negotiations 2.Bringing GATS into the WTO 3.Outcome in terms of liberalization in general and under Mode 4, in particular 4.Issues in Mode 4 liberalization

4
4 Section 1 Mode 4: Scope and Coverage Definition of Trade in ServicesDefinition of Trade in Services a)Negotiating History b)Emergence of the Modal Approach to the definition c)Parity/Symmetry in Factor Movement (i)Specificity of purpose (i)Specificity of purpose (ii)Discreteness of transactions (iii)Limited duration (iv)Essentiality caveat d)Modal Approach embedded/implied in the principle of parity in factor movement

5
5 Section 1 Mode 4: Scope and Coverage (Contd) Annex on Movement of Natural Persons as Service SuppliersAnnex on Movement of Natural Persons as Service Suppliers a)Coverage of self employed and of employees of service supplier associated with Mode 3 b)Temporary movement, Period not defined c)Exclusion of access to labour market, citizenship, etc. d)All categories of Natural Persons at all skill levels covered subject to commitment negotiations e)Flexibility in the application of visa restrictions f)Illustrative list of categories of Natural Persons as service suppliers Ambiguity in definition through distinction between service supply and employment on the basis of the nature of engagement?Ambiguity in definition through distinction between service supply and employment on the basis of the nature of engagement? Foreigners employed by host entities.Foreigners employed by host entities.

7
7 Section 2 Mode Four Specific Commitments to Date (Contd) A comparison of specific commitments in mode four compared to those of other modes A comparison of specific commitments in mode four compared to those of other modes -Most countries made mode four commitments -They inscribed them horizontally -Only 50% of services sectors covered by developed countries; -11% of services sectors covered by developing countries -Quality of mode four commitments generally less than that of mode three.

9
9 Section 2 Mode Four Specific Commitments to Date (Contd) Political and Regulatory concerns profoundly affected levels of commitments under Mode Four Political and Regulatory concerns profoundly affected levels of commitments under Mode Four -Enforcement concerns and the problem of temporary entry leading to permanent entry -Protection of labour markets associated with lower pay foreign services suppliers.

14
14 Section 3 Issues and Challenges in Current Negotiations (Contd) Negotiating techniques to improve mode four commitments Negotiating techniques to improve mode four commitments -Continuation of horizontal (Uruguay Round) approach or a mix of horizontal/sector specific -Advantages to horizontal approach in light of its consistency with national regulatory regimes -Formula and Model Schedule Approaches Formula requires uniform level of commitments by allFormula requires uniform level of commitments by all

15
15 Section 3 Issues and Challenges in Current Negotiations (Contd) Negotiating Techniques (Contd) Negotiating Techniques (Contd) -Model Schedule Approach: Proposes a template around which countries negotiate different levels of obligations Model Schedule currently in circulation by private sector groups centering around GATS Visa and best practices provisionsModel Schedule currently in circulation by private sector groups centering around GATS Visa and best practices provisions Advantages of flexibility to a model schedule and its discipline over request and offerAdvantages of flexibility to a model schedule and its discipline over request and offer

16
16 Section 4 Conclusions and Recommendations Objective of the Paper Effort designed to introduce the issue of mode 4 liberalization for a comprehensive discussion among the participants and promote a better understanding of problems and prospects of this area Conclusions The analysis in the paper points to following important conclusions: 1)Modal approach to definition is a reflection of some basic concerned of the participants: For developing countries parity in the treatment of factor movement of capital and labour and for developed countries the assurance that investment in services is a part of a trade framework

17
17 Section 4 Conclusions and Recommendations (Contd) Conclusions Conclusions (Contd) 2)The notion of parity between factor movement has to find a reflection in liberalization of market access opportunities under modes 3 and 4 3)The current level of scheduled commitments, except in the telecom and financial services sectors, reflect modest liberalization. In case of mode 4, even more so i.e. hardly any liberalization 4)In order to secure a big liberalizing package overall in this Round, the outcome will have to produce significant improvements in mode 4 liberalization by way of providing effective market access.

18
18 Section 4 Conclusions and Recommendations (Contd) Conclusions Conclusions (Contd) 5)Otherwise, GATS might end up as a grim harvester of autonomous liberalization in services rather than a catalyst for future liberalization 6)The present seems a propitious time to attempt a significant improvement in effective market access liberalization under mode 4

19
19 Section 4 Conclusions and Recommendations (Contd) Recommendations In the backdrop of these main conclusions we would recommend the following steps, at the minimum to realize greater liberalization and effective market access under more 4 1)To negotiate market access and national treatment commitments from a common template that is sufficiently flexible for parties with differing interests and varying levels of ambition. 2)To mount a priority effort to gain a single text of agreed commitments that would improve the transparency of granting temporary entry to service providers.

20
20 Section 4 Conclusions and Recommendations (Contd) Recommendations (Contd) 3)To aim to arrive at a generally agreed formulation as to the skill levels of workers affected by the temporary entry negotiations, as a part of the negotiating process itself. 4)To impart greater clarity to rules and commitments by negotiating guidelines for the application of rules, and conditions to market-access commitments.